Just months after a U-turn on a French submarine contract, the Australian government is now canceling an AUD1.3 billion ($976 million) SkyGuardian contract for armed drones.  

The cancellation was revealed by defense officials during a Senate estimate hearing on April 1, 2022. US contractor General Atomics later said in a statement that it had been advised of the cancelation by the Australian Department of Defence.   

The SkyGuardian program was set to provide Australia with an armed, medium-altitude, long-endurance, remotely piloted aircraft system to provide capabilities including surveillance, reconnaissance, electronic warfare and precision strike capability for both land and maritime operations. Australia was due to acquire 12 MQ-9B, the latest variant of the MQ-9 Reaper developed by General Atomics.“Project Air 7003 was expected to provide the Australian Defence Force with a reliable and desperately needed capability,” General Atomics said in a statement, adding that work has been ongoing for a decade. 

The manufacturer said the decision was disappointing for a number of reasons. “Project Air 7003 offered a cost-effective, multi-domain capability that is deeply relevant to Australia’s future strategic environment. Equally disappointing, our many Team SkyGuardian Australia partner companies have invested in the start-up and future support for this capability in Australia and will lose considerable sovereign capability opportunities following this decision.” 

General Atomics said it was keen to continue to work with Australia and highlighted the importance of defense capabilities. 

“If recent world events have shown us anything, it’s that such capabilities are crucial to the future of global defense and security.” 

Australian Labor MP and shadow defense secretary Brendan O’Connor criticized the government for being “all announcement and no delivery on the capabilities needed to keep Australians safe.”   

“The Government didn’t even have the good grace to tell Australian defence industry the program was scrapped,” he wrote in a statement. “Cancelling a $1.3 billion project without notice will reverberate around Australian defence industry, already reeling from the Attack Class cancellation and the secret-offshoring of the Pacific Support Vessel.” 

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